UK Private Motor Insurance Market Share, Opportunities, Segmentation and Forecast to 2021
"UK Private Motor Insurance: Market Dynamics & Opportunities 2017", analyzes the UK private motor insurance market, looking at market size as well as changes in premiums, claims, road casualties, the motor parc, regulations, and opportunities. It discusses competitors in the market, how the market is likely to change due to telematics and driverless cars, and provides future forecasts of market size up to 2021.
The private motor insurance market grew significantly in GWP in 2016.
The latter move resulted in higher claims costs for insurers, which impacted their profitability; they responded by raising premiums. However, following consultation the discount rate is expected to soften, and it is hoped any reforms will reduce the cost of claims for insurers and enable them to pass on savings to consumers.
The Civil Liability Bill is also set to reform motor personal injury claims. It will raise the limit in the small claims track to £5,000 for road traffic accident claims, and will additionally introduce claims tariffs and ban pre-medical offers.
But it remains uncertain when reforms will be introduced - not to mention how successful they will be.
- GWP for the private motor insurance market grew by 12.4% to £12.2bn in 2016.
- Bodily injury claims are the highest cost for motor insurers, with the average claim costing £10,799.
- Direct Line and Aviva are the leading private motor insurers, with market shares of 12.4% and 12.1% respectively in 2015.
Reasons to access
- Ensure you remain competitive as new innovations and insurance models begin to enter the market.
- Be prepared for how regulation will impact the private motor insurance market over the next few years.
- Benchmark yourself against competitors.
Table of Content: Key Points
- EXECUTIVE SUMMARY 3
1.1. The success of the Civil Liability Bill and a review of the discount rate are crucial to reduce premiums 3
1.2. Key findings 3
1.3. Critical success factors 3
- MARKET DYNAMICS 10
2.1. Introduction 10
2.2. The private motor insurance market continued to grow in 2016 10
2.2.1. The private motor market grew by 12.4% to reach £12.2bn in GWP in 2016 10
2.2.2. Comprehensive policies make up the majority of the private motor market 11
2.2.3. The Lloyd’s of London market accounts for 1.4% of private motor insurance GWP 12
2.3. Motor insurance premiums have reached an all-time high 12
2.3.1. Comprehensive and non-comprehensive premiums are both following an upwards trend 13
2.3.2. IPT has risen to 12% 16
2.3.3. The requirement to notify customers of last years’ premium will encourage shopping around 17
2.4. The discount rate has increased the cost of claims 18
2.4.1. The discount rate was changed from 2.5% to -0.75% 18
2.4.2. Insurers’ profits have been hit by the rate change 18
2.4.3. The Ogden rate change has impacted profitability 19
2.4.4. Insurers’ results highlight the impact of the discount rate change on profits 19
2.4.5. The MoJ is consulting on how the discount rate should be set going forward 20
2.5. Gross claims paid continued to increase in 2016 20
2.5.1. Claims notified remained steady in 2016 20
2.5.2. Personal injury motor claims are on the rise 22
2.5.3. Bodily injury claims have the highest cost for motor insurers 23
2.5.1. Whiplash claims account for up to 80% of motor personal injury claims numbers 25
2.5.2. Fraud remains a significant issue 26
2.5.3. Motor personal injury claims remain high, while RTA claims are in decline 26
2.5.4. Most RTA casualties are car occupants, but these are the least vulnerable road users 27
2.5.5. The number of pedal cyclist casualties has reached a five-year low 27
2.5.6. Car and taxi use reached an all-time high 28
2.5.7. The UK motor parc continues to grow 30
- COMPETITOR DYNAMICS 32
3.1. Direct Line and Aviva hold the largest shares of private motor 32
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